Cryptocurrency News
As the U.S. election approaches on Nov. 5, Bitcoin traders are preparing for increased volatility, with estimates suggesting price swings as high as 20%, according to data from DeFi derivatives platform Derive.
“The latest trading analysis provides valuable insights into market dynamics as we near significant financial events,” said Derive founder Nick Forster in an interview with Decrypt on Monday.
Recent data reveals a strong focus on an $80,000 Bitcoin strike price and an abundance of short-term call sales, as traders leverage option premiums to prepare for potential price movements.
On Monday, Bitcoin briefly surpassed $70,000, reaching a level not seen since early June, with CoinGecko reporting a price of $71,200, marking a more than 5% increase for the day.
“The prevalence of call sales indicates a strategic collection of premiums by traders, while the $80,000 strike point suggests a potentially pivotal moment for Bitcoin,” noted Forster.
Over the past 24 hours, more than 47% of options sold were calls, reflecting traders’ anticipation of price increases and their interest in taking advantage of election-related volatility.
Traders are gearing up for a potentially rocky road ahead as volatility patterns across various expiration dates indicate uncertainty regarding the direction of future price movements.
With the upcoming U.S. presidential election between Vice President Kamala Harris and former President Donald Trump, Americans are expecting significant market reactions, especially in relation to crypto policies.
Short-term volatility now outweighs long-term volatility, with a notable spike anticipated during election week, indicating potential rapid price fluctuations as events unfold.
Traders are increasingly betting on the immediate impact of the U.S. election on Bitcoin’s price, bracing for sharp swings as election-related developments unfold.
The rise in volatility for options expiring within seven days emphasizes heightened sensitivity to upcoming economic and political news.
“There’s a one in three chance of a BTC swing exceeding 10% on election day, with a 5% likelihood of a more volatile 20% movement, underscoring the potential for significant price action tied to election outcomes,” Forster noted.
As the election nears, traders are willing to pay more for options as a protective measure, indicating a focus on risk management and anticipation of larger price shifts.
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